The settlement resolves allegations Hut 8 misled investors about operational issues in its 2023 merger with U.S. Bitcoin Corp.
Hut 8 will pay $2.35 million to settle a securities class action lawsuit tied to its 2023 merger with U.S. Bitcoin Corp. The company denied wrongdoing but agreed to the deal, pending court approval, to end claims it failed to disclose energy and connectivity problems at a Texas mining venture.
The lawsuit followed a January 2024 short-seller report by J Capital Research, which triggered a 23% drop in Hut 8’s share price. Investors alleged the company overstated the merger’s benefits while concealing issues at King Mountain, a joint venture where U.S. Bitcoin held a 50% stake.
The $2.35 million settlement represents about 19.6% of the estimated maximum recovery for investors. Hut 8, now focused on AI data centers, completed the merger in November 2023.